What a Professional Bookkeeper Actually Does (That You're Probably Not Doing)

A client in the Heights called us last October, furious at her previous bookkeeper. “I was paying $400 a month,” she said, “and all they did was enter transactions.”

She was right. That’s all they did.

No reconciliation. No monthly close. No expense categorization review. No communication with her CPA. Transactions went into QuickBooks, and that was the end of the service. When her CPA opened the file at tax time, half the entries were in the wrong categories. Her accounts hadn’t been reconciled in seven months. The CPA charged her $3,800 to untangle it (on top of the $4,800 she’d already paid the bookkeeper over the year).

She didn’t have a bookkeeper. She had expensive data entry.

This is the core misunderstanding most Houston business owners have about professional bookkeeping. They think it’s someone typing numbers into software. The job is actually closer to financial quality control. A set of recurring processes that keep the books accurate, current, and ready for anyone who needs to read them.

Here’s what a professional bookkeeper actually does, and why each piece matters to a business that wants to grow without financial surprises.

Transaction Recording and Categorization

This is the part everyone knows about. Revenue comes in, expenses go out, every transaction gets recorded in the accounting system.

But recording is the easy part. Categorization is where the skill lives.

A $2,400 charge from Home Depot on a contractor’s credit card could be materials for a job (cost of goods sold), tools for the shop (equipment), or supplies for the office (operating expense). Each classification hits the profit and loss statement differently. Each affects tax deductions differently. A professional bookkeeper knows the difference because they’ve seen thousands of these transactions across dozens of Houston businesses.

The consequence of bad categorization isn’t just a messy chart of accounts. It’s missed deductions at tax time. We cleaned up a file for a Sugar Land electrical contractor last year where $18,000 in deductible vehicle expenses had been coded as “miscellaneous.” His prior-year return didn’t claim any of it. That’s real money lost to sloppy classification.

Monthly Bank Reconciliation

Reconciliation is the single most important thing a bookkeeper does. It’s also the thing DIY bookkeepers skip most often.

The process is simple in concept: compare every transaction in your accounting software against every transaction on your bank statement. Make sure they match. Investigate anything that doesn’t.

In practice, it catches problems that would otherwise stay hidden for months:

• A $500 charge you didn’t authorize that got buried in a stack of legitimate vendor payments
• A customer’s check that was deposited but never recorded as revenue
• A duplicate payment to a supplier that nobody noticed because both invoices had similar amounts
• Credit card processing fees that are higher than what your merchant agreement says they should be

A restaurant owner on Westheimer discovered through reconciliation that their POS system had been double-charging credit card processing fees for four months. The overpayment was $2,100. Without monthly reconciliation, that money would have disappeared into the noise.

Reconciliation also creates a paper trail that matters during audits. If the IRS or a lender ever questions a number on your financials, reconciled books have the documentation to back it up. Unreconciled books have guesswork.

Monthly Close

The monthly close is where bookkeeping becomes financial intelligence.

Closing the books means everything is reconciled, every transaction is categorized, all adjusting entries are made, and the financial statements for the month are final. Once a month is closed, the numbers are locked. Nobody goes back and changes them unless there’s a documented reason.

This sounds bureaucratic. It’s actually what makes the numbers useful.

A construction company in the Energy Corridor used to look at their books once a year (at tax time). They had no idea which projects were profitable and which were losing money. After they started getting monthly closes, they discovered that their residential remodel jobs were running 23% margins while their commercial projects were at 8%. They dropped two commercial clients and replaced them with residential referrals. Revenue went down by $60,000. Profit went up by $41,000.

That decision was invisible without monthly closes. The annual P&L showed total revenue and total expenses. Only the monthly breakdown, project by project, revealed where the money was actually going.

Accounts Receivable and Payable Management

For service businesses that invoice clients, accounts receivable tracking is the difference between knowing who owes you money and hoping everybody pays.

A professional bookkeeper monitors outstanding invoices, flags overdue accounts, and provides aging reports that show exactly how much is owed and for how long. A typical aging report breaks receivables into current, 30 days, 60 days, and 90+ days past due.

On the payable side, the bookkeeper tracks what you owe vendors, when it’s due, and whether early payment discounts are worth taking. A 2/10 net 30 discount (2% off if paid within 10 days) saves $200 on a $10,000 invoice. Across a year of vendor payments, those discounts add up to thousands.

We’ve worked with a Katy landscaping company that was paying every invoice the day it arrived because the owner was afraid of forgetting. His cash flow was always tight in the first half of the month and flush in the second half. When we set up a proper payables schedule (paying on day 25 of the net 30 term instead of day 1), his cash flow smoothed out and he stopped needing his line of credit during slow weeks.

Tax Preparation Support

A bookkeeper doesn’t file your taxes. That’s your CPA’s job. But the quality of the file your CPA receives determines both the speed and the cost of tax preparation.

Clean books from a professional bookkeeper include:

• A reconciled trial balance for every month of the year
• A chart of accounts that follows IRS categories
• Supporting documentation for every deduction
• Quarterly estimated tax payments tracked and documented
• Year-end adjusting entries already posted

CPAs in Houston charge $150-300/hour. A CPA who receives clean books spends 3-5 hours on a business return. A CPA who receives a shoebox of receipts and an unreconciled QuickBooks file spends 12-20 hours on the same return. The difference in CPA fees alone ($1,350 to $4,500) often exceeds the annual cost of the bookkeeper.

One of our clients, a sole proprietor running a consulting practice near the Galleria, switched to professional bookkeeping in 2024. Her CPA bill dropped from $4,100 to $1,800 the following tax season. The bookkeeper cost $450/month. Net savings after bookkeeping fees: $2,900/year, plus she got her weekends back.

Financial Reporting

Numbers in a spreadsheet are data. Numbers on a properly formatted financial statement are information.

A professional bookkeeper produces three core reports:

The profit and loss statement shows revenue, expenses, and net income for a specific period. It answers the question: did we make money this month?

The balance sheet shows assets, liabilities, and equity at a specific point in time. It answers the question: what is the business worth right now?

The cash flow statement shows where money came from and where it went. It answers the question: why is there less cash in the account than the P&L says we earned?

That last one trips up more Houston business owners than any other. A business can be profitable on paper and still run out of cash. It happens when revenue is tied up in unpaid invoices, when inventory purchases eat available cash, or when loan principal payments reduce cash without showing up as expenses on the P&L.

A professional bookkeeper explains these reports, not just produces them. The difference between handing someone a balance sheet and helping them understand what the numbers mean is the difference between data entry and bookkeeping.

What This Costs in Houston

Professional bookkeeping in Houston ranges from $200/month for a solo freelancer with minimal transactions to $2,500/month for a full-service engagement with payroll, AP/AR management, and weekly reporting.

Most Houston small businesses (service companies, contractors, consultants, retail shops doing under $2M in revenue) land between $350 and $900/month.

That number makes some business owners hesitate. Then they compare it to the real cost of doing it themselves: the 8-10 hours of monthly time, the missed deductions, the inflated CPA bills, the penalties from late estimated payments. The math rarely favors DIY once you add the invisible costs.

The Difference Between a Bookkeeper and a Data Entry Clerk

Not every service that calls itself bookkeeping delivers what’s described above. The market is full of providers who record transactions and stop there. That’s data entry with a bookkeeping label.

A professional bookkeeper reconciles every account monthly. Produces financial statements. Communicates with your CPA. Flags unusual transactions. Catches errors before they compound. Closes the books on a schedule.

The client in the Heights who called us, furious? She didn’t get that. She paid bookkeeping prices for data entry service. The gap between the two cost her $3,800 in CPA cleanup fees and nearly a year of financial statements she couldn’t trust.

When evaluating a bookkeeper, the question isn’t “do they enter transactions?” Every bookkeeper does that. The question is what happens after the transactions are entered. That’s where the work (and the value) actually lives.

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EZQ Group provides professional bookkeeping services for Houston small businesses. Monthly reconciliation, financial reporting, tax prep support, and the kind of financial oversight that keeps the numbers clean and the CPA bills low. Schedule a consultation to see what a real bookkeeping engagement looks like for your business.